OPINION: Election plot twist: Trump and Musk to oversee great US battery boom in red states 

In the alliance between President-elect Donald Trump and Elon Musk stands the pending electric vehicle (EV) battery boom in the US.

Lithium ion batteries are a new mega-industry in-waiting sparked by $110 billion of Inflation Reduction Act (IRA) money.

Three years ago, while China dominated, the US was a bystander in this global battery arms race with only a handful of gigafactories producing batteries for domestic EV production.

Today, 40 super-sized battery plants span the country in stages of construction that will soon employ up to 4,000 American workers and spark over 50,000 related jobs per site.

While EVs and batteries have to date been seen through a Democratic lens, 35 of the 40 gigafactories are in Republican states, especially Michigan, Ohio, Tennessee, Georgia and Arizona.

Meanwhile, Nevada is home to Elon Musk’s jewel-in-the-crown, the Tesla Gigafactory 1, itself the first and still one of the world’s biggest EV battery plants.

All of this is government-powered, sunk investment. It’s already paid for.

And these super-sized EV battery plants are starting to be turned on.

As a result, President Trump will oversee the first ever US battery boom.

In what is one of the greatest plot twists of Election 2024, nearly all of this battery-related economic activity and future jobs are in Republican strong-holds.

Data from Benchmark Mineral Intelligence confirms that 92% of the $110 billion spent is in Republican states while 7% is Democratic. This equates to 93% of the total 1,300 gigawatt-hours (GWh) of batteries expected to come online by 2030.

Trump has vowed to oversee a “Golden Age of America” where energy takes centre stage and, whether it is politically convenient or not, batteries lie at the centre of this battle for energy independence.

And the same batteries are not just used for EVs but also mass scale energy storage – its real impact seen for the first time in 2024.

California and Texas are now leading the battery storage charge. At times of high demand and cost, batteries are the leading single source of electricity in California – a glimpse of what’s to come.

Storing sunshine is another one of Musk’s visions.

“If you wanted to power the entire US with solar panels, it would take a fairly small corner of Nevada or Texas or Utah; you only need about 100 miles by 100 miles of solar panels,” Musk said in 2017.

This coming of age of battery storage (and ramp up of EVs) has been driven by the falling cost of lithium ion batteries: they are now at the lowest cost point they have ever been.

November 2024 data from Benchmark shows that LFP batteries’ cost has plummeted to $59 per kilowatt-hour (kWh) while the industry average across all chemistries is $66/kWh.

When Musk’s Tesla Gigafactory was being constructed in 2017 batteries were four times this price.

Yet unless America gets a grip on the supply chain for key battery raw materials, these low prices will not last forever.

Get America Mining Again

Key critical minerals such as lithium, rare earths, nickel, graphite, and cobalt are central to the success or failure of the battery and EV movement.

These elements now account for up to 80% of the cost of a lithium ion battery.

Batteries mean mining.

Elon Musk famously called lithium refining “a licence to print money”.

He has been preoccupied with lithium mining and refining for well over a decade now flirting with major acquisitions and resulting in Tesla building its own lithium refinery in Texas.

This could be a sign of what is to come on a giga-scale.

China has used its grip on low quality lithium ore production to keep prices artificially low and with it the price of their domestic batteries and electric vehicles.

China is now flooding the global market with its domestic EVs resulting in a Democratic Administration imposing 100% tariffs on Chinese-made imports – a number that’s simply unheard of.

The EU followed suit with a softer 35.2% maximum tariff due to its closer ties with China.

These numbers are big. The geopolitical chips are now on the table.

Controlling the supply chain for these minerals means holding the sway of industrial power.

Yet the US is still highly dependent on imports for these crucial elements, particularly from China influenced supply.

The first Trump Administration can be credited with starting this focus on critical minerals with Executive Order 13817 back in 2017. It was a timely bid to wrestle control of these supply chains back from China.

It was a baton that the Biden Administration then ran with as a core part of the Senator Joe Manchin-inspired IRA.

If America is to have any golden age in these future facing industries, domestic mining and refining of critical minerals must ramp up significantly.

A mining renaissance is needed in middle America.

The US needs to make the products that its downstream industries use – no longer can this be outsourced to countries over 10,000 miles away.

This means mining, refining and chemical-making – all the things that used to happen two generations ago.

A mining renaissance, especially in mineral rich states such as Nevada, Arizona, Utah, and Idaho, would add a 10x multiplier to this entire battery mega-trend.

It would bring jobs back and secure these future facing industries: a Great American Battery Boom would underpin A Golden Age for America.

The US has only done half the job: building EVs and gigafactories are checked.

President Trump now has the chance to finish what he started and bring critical minerals mining back to America.

Politically speaking, it’s all lined up.

The blocker: whether President Trump and Elon Musk can make this happen at speed and take this golden opportunity.

Benchmark has the world’s largest team of analysts dedicated to lithium ion and energy transition supply chains.

To learn more or speak with our experts, provide your details here.